India is grappling with a severe shortage of Di-Ammonium Phosphate (DAP), a critical fertilizer for crops like wheat and mustard. The crisis is hitting hard in agriculturally dominant states like Punjab, Haryana, and Uttar Pradesh. Let’s explore what’s behind the shortage and how it’s affecting farmers.
Why is There a DAP Shortage?
The shortage stems from India’s heavy dependence on DAP imports, particularly from China, Saudi Arabia, and Morocco. This year, several factors have worsened the situation:
- China’s Export Reduction
China, the largest exporter of DAP, has drastically cut exports to India due to domestic demand and export restrictions. Shipments from China to India have dropped by 75% in the first half of 2024. - Global Shipping Disruptions
Ongoing conflicts, such as the Israel-Hamas war, have disrupted key shipping routes like the Red Sea. These blockages have made DAP imports more expensive and challenging. - Declining Domestic Production
India produces about 40% of its DAP needs, but production fell from 27.01 lakh tonnes (LT) in 2023 to 25.03 LT in 2024 (April to October). Combined with a sharp drop in imports, from 39.68 LT to 27.84 LT during the same period, the available stock is far below the required 100 LT annually. - Rising Costs
The global price of DAP jumped from $515 per tonne in May 2024 to $642 per tonne in October 2024. Indian farmers are paying Rs 250-350 more per bag, adding to their financial strain.
How is the Shortage Impacting Farmers?
The impact is most visible in states like Punjab, where DAP is essential for winter crops. Punjab requires 55 lakh tonnes of DAP for the rabi season, but the supply falls significantly short.
Farmers like Baldev Singh from Punjab are forced to pay higher prices, worsening their financial woes. In Haryana, long queues at government centers often end in frustration due to insufficient stock. Rising costs and limited availability threaten crop yields, making the crisis a potential risk to food security.
Government Measures and Challenges
The Indian government is trying to address the issue by:
- Signing long-term supply agreements.
- Providing subsidies, including Rs 3,500 per tonne of DAP.
- Promoting alternatives to DAP fertilizer.
Despite these efforts, the gap between demand and supply persists, leaving farmers dissatisfied.
What Lies Ahead?
India must increase its domestic fertilizer production to reduce dependence on imports. Efforts to ramp up urea production have shown promise, and similar initiatives for DAP could decrease import reliance by 15% by FY26. However, achieving full self-reliance will take time and significant investment.
In the short term, promoting efficient fertilizer use and exploring viable alternatives could help farmers. Long-term solutions, like diversifying sourcing and boosting local production, are essential to avoid future crises.
India’s DAP shortage is more than just a fertilizer issue; it challenges its agricultural backbone. Farmers and policymakers must work together to safeguard the nation’s food security and rural economy.
